This and That by Dennis Wade

Not murder, not drugs, not loansharking.  So, what is the life blood of Organized Crime?  It is bookmaking, accepting illegal wagers on sporting contests in amateur and professional arenas.  I learned this lesson first hand in the Rackets Bureau of the Manhattan D.A.’s Office.  But on Monday, May 14, 2018, the United States Supreme Court may have mowed down more mobsters than any prosecutor of the modern era.

Writing for the majority in Murphy, Governor of New Jersey v. National Collegiate Athletic Assn., et al. Justice Alito struck down a 1992 federal law that banned commercial sports betting in most states, effectively allowing states to compete with the mob for an estimated $150 billion in illegal wagers and professional and amateur sports.

At issue was a federal statute known as PASPA–the Professional and Amateur Sports Protection Act.  This law prohibited states from authorizing sports gambling.  Its chief sponsor was then New Jersey Senator Bill Bradley, a former college and professional basketball star, who argued the law was necessary to safeguard the integrity of sports.

In fact, the majority recognized the legalization of sports gambling was controversial and held the potential to “corrupt professional and college sports.”  But what struck me about the decision was the conservative majority, while recognizing the perils of striking down PASPA, believed the virtue of strictly adhering to constitutional jurisprudence outweighed the perils of its decision.  As stated by Justice Alito in conclusion:

The legalization of sports gambling requires an important policy choice, but the choice is not ours to make. Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own.  Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution.  PASPA is not.  PASPA “regulate[s] state governments’ regulation” of their citizens, New York, 505 U.S., at 166. The constitution gives Congress no such power.

On its face, this decision does not speak to insurance defense or coverage work.  But often–and it is the case here–study of monumental SCOTUS decisions yields key insights on how best to position and argue motions and appeals in coverage and defense cases.

The challenge faced by two New Jersey governors, first Christie and then Murphy, was to persuade the high court that, while the purpose behind PASPA had merit, it ran afoul of the wording of the Constitution.  Equally, coverage and defense lawyers face similar challenges–getting jurists to focus on applying the law or the wording of the insurance contract to the facts without regard to the “expectations” of the other side, whether reasonable or otherwise.

If you would like to put down a “line” or this case, discuss bookmaking or insurance, please email or call Dennis.  And that’s it for this This and That.